Back in March and April, we posted a series of nine articles on the Exposure Draft of the Bill that was released for public comment by IP Australia. These articles covered eight selected aspects of the Draft Bill, plus one final summary article (see Australian Patent Reform – Wrap-Up).

In this post, we revisit those eight original topics, and look at how the Senate Bill differs (if at all) from the exposure draft, to see how IP Australia’s consultation has affected the proposed legislation. (Note that the headings below link to our original articles on each topic.)

One of the biggest problems with the current Australian patent law is the low standard of inventiveness required, primarily due to the requirement that prior art be ‘ascertained, understood and regarded as relevant’ by the relevant person skilled in the art before it can be considered as a basis for an assessment of inventive step.

The Exposure Draft proposed that this requirement be removed (Schedule 1, Clauses 2 to 4).

The Australian patent law currently demands only a very basic standard of usefulness, or ‘utility’, of a valid patent claim. This does not necessarily capture cases of ‘speculative claiming’, for example where one or more generic or prospective applications of an ‘invention’ are proposed, without any credible basis for the belief that it would actually work.

For the purposes of this Act, an invention is taken not to be useful unless a specific, substantial and credible use for the invention (so far as claimed) is disclosed in the complete specification.

This definition of ‘usefulness’ has been retained verbatim in the Senate Bill (also Schedule 1, Clause 6) . However, an additional subclause is added to qualify the requirement:

The disclosure in the complete specification must be sufficient for that specific, substantial and credible use to be appreciated by a person skilled in the relevant art.

This qualification clarifies that the standard against which utility is to be assessed is that of the person skilled in the art. Accordingly, it will not be necessary for the specification to go into any more detail than is necessary for the skilled person to accept that the disclosed use meets the new utility requirements. This was always the intention (based on the way utility is assessed under the US law), however the qualification puts this beyond doubt.

The current law requires that a provisional specification ‘describe the invention’, which is a lower level of disclosure than is required for a complete specification, and lower than may be required to support a priority claim in a foreign application. The Exposure Draft therefore proposed that the Act be amended to require an enabling disclosure in a provisional specification (Schedule 1, Clause 7).

Under the current Australian patent law, it is sufficient for the specification to enable just one embodiment falling within the scope of the claims, regardless of their breadth, which is a lower requirement than in most comparable jurisdictions.

We were not entirely convinced that the ‘European-style’ proposal in the Exposure Draft was the right way to go on this (Schedule 1, Clause 8). However, this wording has been retained in the Senate Bill (also Schedule 1, Clause 8).

The Australian patent law currently requires that each claim be ‘fairly based’ on the matter disclosed in the specification, which is yet another low threshold which requires only that the scope of the claims be consistent with ‘what the body of the specification read as a whole discloses as the invention’.

The Exposure Draft proposed the adoption of a UK/European approach through the replacement of ‘fair basis’ with a support requirement (Schedule 1, Clause 9). While we were again unconvinced that this was the best approach, this is another provision that has been retained verbatim (also Schedule 1, Clause 9).

The Exposure Draft proposed two new exemptions from infringement of a patent (Schedule 2, Clause 1). The first was intended to extend the existing regulatory approval exemption for pharmaceutical products to encompass otherwise infringing acts relating to obtaining government approval for other products. The second new exemption was an ‘experimental’ or ‘research’ use provision.

Both new exemptions are retained in the Senate Bill (also Schedule 2, Clause 1). The only change is a clarification of one of the exemplary ‘experimental uses’, from ‘determining whether the patent for the invention has been infringed’ to ‘determining whether the patent for the invention would be, or has been, infringed by the doing of an act.’

In addition to the various reforms to the substantive requirements for validity of a patent, the Exposure Draft proposed a number of changes to improve the standard and effectiveness of examination, and related procedural matters.

Provision for preliminary search and opinion

The proposal to provide for a preliminary search and opinion (similar to the PCT and European search opinions) has been retained verbatim in the Senate Bill (Schedule 1, Clause 11).

Examination of utility

The Senate Bill retains the provision from the Exposure Draft which will make lack of utility a ground for refusal of a patent application during examination (Schedule 1, Clause 12).

The only change in the Senate Bill is the exclusion of subsection 40(1) (requirements of a provisional application) from the matters considered during examination. In one sense, this amendment is superfluous, since provisional applications (by definition) are not examined. On the other hand, it avoids any possibility of inconsistency or confusion, once the requirements for provisional specifications are raised to similar standards to those of complete specifications.

Permitting examiners to consider evidence of ‘prior use’

The Exposure Draft proposed the repeal of subsection 45(1A), which prohibits consideration of ‘prior use’ (as opposed to prior publications) as prior art during examination of a patent application.

The Senate Bill retains this repeal (Schedule 1, Clause 13).

Lowering the barrier to refusal of an application

The Exposure Draft proposed to set the standards for refusal of an application (or revocation of an innovation patent), as a result of examination or opposition, to be uniformly the ‘civil standard’ of the ‘balance of probabilities’.

This was already widely understood to the the effect of the terminology ‘the Commissioner is satisfied…"’ in Section 49 of the Patents Act 1990. We wondered at the time why it would therefore be necessary to change this to ‘the Commissioner is reasonably satisfied’, as was proposed in the Exposure Draft.

In the Senate Bill, this has been addressed. The test is, uniformly, satisfaction ‘on the balance of probabilities’ wherever an assessment of validity is to be made (Schedule 1, Clauses 14, 15, 14, 15, 18, 19, 21, 26, 28 and 39-54). Someone has clearly gone through the Act, and identified all of the further places relating to decisions, and inserted references to the ‘balance of probabilities’ test.

Changes to amendment provisions

Currently, section 102 of the Patents Act prohibits any amendment being made to a patent specification that would result in subject matter being claimed which was not disclosed in the specification as filed. It is therefore permissible, for example, to add new material to the description of a patent specification at any time – including after grant – so long as this new matter is not claimed.

The Exposure Draft (Schedule 1, Clause 29) proposed to amend subsection 102(1) to prohibit any amendment that would add subject matter extending beyond the disclosure in the specification as filed.

This provision has been retained in the Senate Bill (also Schedule 1, Clause 29), however it has been expanded to encompass the disclosure of not only the filed specification, but also any other prescribed documents (which will presumably be identified in the Regulations). The Explanatory Memorandum notes that this is intended to capture disclosure in documents that are not strictly part of the ‘specification as filed’, such as the abstract, or documents relating to allowable amendments to the filed specification.

The Exposure Draft proposed that the changes to substantive requirements for validity would not only to all applications filed after commencement of the amendments, but also to applications that have already been filed but for which no examination report has been issued by the date of commencement.

We felt very strongly that this was an unacceptable proposal. Indeed, we felt strongly enough to file our own submission on this issue. We believe that applicants and their advisers are entitled to certainty regarding the laws that will apply to an application at the time of filing, and for the purpose of informed decision-making prior to filing. The proposed transitional provisions would have violated this principle.

We are therefore very pleased to see that the commencement and transition provisions in the Senate Bill have been amended to address this issue. The relevant provisions of the Bill will not commence until 12 months after it receives the Royal Assent (Clause 2 of the Bill), and will not apply to any pending applications in respect of which examination has already been requested (Schedule 1, paragraph 55(1)(b)). This will allow applicants of applications pending at the time the Bill is passed a period of at least 12 months to request examination under the existing provisions.

CONCLUSION

Much of the Senate Bill remains unchanged, or insubstantially changed, from the Exposure Draft.

However, it appears that IP Australia has received, and acted upon, feedback from stakeholders, and a number of improvements have been made.

We are particularly pleased to see that the potential problems with the transitional provisions have been addressed, since these were our most significant concern in relation to the Exposure Draft.

We now await further progress of the Bill in the Senate, and its introduction into the House of Representatives also.